Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the second quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 5 years and analyze what the smart money thinks of Voya Financial Inc (NYSE:VOYA) based on that data and determine whether they were really smart about the stock.
Voya Financial Inc (NYSE:VOYA) has experienced an increase in hedge fund interest lately. Voya Financial Inc (NYSE:VOYA) was in 41 hedge funds’ portfolios at the end of the second quarter of 2020. The all time high for this statistics is 45. There were 32 hedge funds in our database with VOYA positions at the end of the first quarter. Our calculations also showed that VOYA isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
According to most investors, hedge funds are seen as underperforming, outdated financial tools of years past. While there are over 8000 funds trading today, Our experts look at the bigwigs of this club, around 850 funds. These hedge fund managers preside over the lion’s share of all hedge funds’ total asset base, and by keeping track of their top equity investments, Insider Monkey has unsheathed a few investment strategies that have historically outstripped the market. Insider Monkey’s flagship short hedge fund strategy outrun the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Our portfolio of short stocks lost 34% since February 2017 (through August 17th) even though the market was up 53% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost precious metals prices. So, we are checking out this junior gold mining stock. Legal marijuana is one of the fastest growing industries right now, so we are checking out stock pitches like “the Starbucks of cannabis” to identify the next tenbagger. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. With all of this in mind let’s go over the key hedge fund action regarding Voya Financial Inc (NYSE:VOYA).
What does smart money think about Voya Financial Inc (NYSE:VOYA)?
At second quarter’s end, a total of 41 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 28% from one quarter earlier. On the other hand, there were a total of 43 hedge funds with a bullish position in VOYA a year ago. With the smart money’s sentiment swirling, there exists a few noteworthy hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).
Among these funds, Pzena Investment Management held the most valuable stake in Voya Financial Inc (NYSE:VOYA), which was worth $237.9 million at the end of the third quarter. On the second spot was Samlyn Capital which amassed $236 million worth of shares. Citadel Investment Group, Millennium Management, and Point72 Asset Management were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Strycker View Capital allocated the biggest weight to Voya Financial Inc (NYSE:VOYA), around 8.44% of its 13F portfolio. Capital Returns Management is also relatively very bullish on the stock, setting aside 4.4 percent of its 13F equity portfolio to VOYA.
As aggregate interest increased, some big names have jumped into Voya Financial Inc (NYSE:VOYA) headfirst. Alyeska Investment Group, managed by Anand Parekh, created the most outsized position in Voya Financial Inc (NYSE:VOYA). Alyeska Investment Group had $18.1 million invested in the company at the end of the quarter. Clint Carlson’s Carlson Capital also initiated a $12.1 million position during the quarter. The other funds with new positions in the stock are Usman Waheed’s Strycker View Capital, Richard SchimeláandáLawrence Sapanski’s Cinctive Capital Management, and Ryan Tolkin (CIO)’s Schonfeld Strategic Advisors.
Let’s go over hedge fund activity in other stocks similar to Voya Financial Inc (NYSE:VOYA). We will take a look at Thor Industries, Inc. (NYSE:THO), Berry Global Group Inc (NYSE:BERY), Axon Enterprise, Inc. (NASDAQ:AAXN), Farfetch Limited (NYSE:FTCH), Donaldson Company, Inc. (NYSE:DCI), Sensata Technologies Holding plc (NYSE:ST), and Santander Consumer USA Holdings Inc (NYSE:SC). This group of stocks’ market valuations match VOYA’s market valuation.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 33.6 hedge funds with bullish positions and the average amount invested in these stocks was $723 million. That figure was $792 million in VOYA’s case. Berry Global Group Inc (NYSE:BERY) is the most popular stock in this table. On the other hand Santander Consumer USA Holdings Inc (NYSE:SC) is the least popular one with only 20 bullish hedge fund positions. Compared to these stocks Voya Financial Inc (NYSE:VOYA) is more popular among hedge funds. Our overall hedge fund sentiment score for VOYA is 87.3. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 33% in 2020 through the end of August and still beat the market by 23.2 percentage points. Unfortunately VOYA wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on VOYA were disappointed as the stock returned 11.6% since the end of the second quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
Disclosure: None. This article was originally published at Insider Monkey.